Brokers' four most dreaded words:

Brokers' four most dreaded words:


According to Ryneveld van der Horst, finance director at, although the current financial crisis is shaping up to be comparable to the 1930’s Great Depression, there are still plenty of avenues for brokers to look down in order to increase their revenue. 

“The defining difference between a recession and Depression is a recession is the person next to you losing their job, a Depression is you losing your job.” He commented at last week’s Mortgage Exposition.


Speaking of the troubles introducers face in placing deals, he said that empty predictions guessing when this spell would end were useless, “the truth is no one can really know when the situation will improve. If they could, they would have been able to foresee the current crisis in the market. I think the four words dreaded most by brokers right now are: this time it’s different. We’re seeing problems on an unprecedented scale, the market has imploded and whereas last year there were over 30,000 products available to intermediaries, now there are only about 3,200 left on the market.


“The present City generation has only ever known good times, therefore in some ways a lack of understanding has contributed to the meltdown. Let’s not forget that this is when the term ‘safe as houses’ was coined. It was silly, it was irresponsible and I think everybody now realises, what goes up must come down.”


However it’s not all doom and gloom. As Mr van der Horst says, “the media has played its part in depressing us” and despite this, there are still plenty of ways for brokers to survive in the industry.


Describing the team behind as “optimists, but realists” he explained that bridging is taking up the forefront in the market and although the sector has been misrepresented in the past, with the prevalent idea of shady loan sharks, “these are urban myths that need to be dispelled. Bridging is now gaining respectability.”


Mr van der Horst went on to say: “A bridging loan is a short term financial solution, it’s an expensive product with rates around 1.35% per month but there are four very good reasons to use it: it offers a discounted purchase with lending based on market value instead of purchase price, a decision can be made within days rather than weeks, it’s easy to use and applications can be carried out online and it will solve any short term liquidity problem. In addition, the 1% commission fees brokers get for placing a deal with will boost their earnings significantly.”


“This is an interesting market place right now; the days of using a house as an ATM machine are over. The main challenge right now is that you have to be very careful in the current market to be a responsible lender – selling the appropriate product to a client. Having a viable exit strategy is the most important aspect in bridging and they are now more relevant than ever. After all, they say that a bridge is only a bridge if you can see the other side.”

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